U.S. liquefied natural gas is not an option for Europe.

You hear it everywhere: America needs to open up its natural gas markets and export liquefied natural gas. It is a simple solution to solve Europe's dependence on Russian natural gas.

It's hogwash. Let me explain.

First, liquefied natural gas is a nation's last fuel of choice. Think about it. To make liquefied natural gas, producers need to buy natural gas, which has already been processed. They need to process it again. They need to store it, move it and store it again. Then they need to undo everything and convert the liquefied natural gas back to natural gas. The only value in this long and expensive chain of events is transportation. To assure the price is high enough; many consuming markets index the price of natural gas to oil.

Second, the U.S. has only one liquefied natural gas export facility in operation. It is in Alaska. It is owned by ConocoPhillips (COP). It has been operating since the late 1960s. Unless it gains access to new sources of natural gas, ConocoPhillips' Kenai LNG Export Terminal will cease operations within 20 months.

The good news is that there are new natural gas resources available. ConocoPhillips, BP (BP), ExxonMobil (XOM) and TransCanada (TRP) announced plans to develop new resources. Today they are securing permission from the State of Alaska and federal regulators. According to Breaking Energy, they plan to spend $45 billion to $65 billion, which could make this project become the "largest integrated gas/LNG project of its kind ever constructed."